Valuation of Pharmaceutical and Biotechnology Companies: Comparable Multiples Method (Part 2)

In this article the Comparable Multiples Method (CMM) is discussed and analysed. CMM is based on a relatively basic principle; that the value of the target company (the company to be valued) can be derived through certain multiples (financial ratios) of similar (comparable) companies. StepĀ 1: Analysis of the Target Company There are certain data that …

Valuation of Pharmaceutical and Biotechnology Companies: DCF (Part 1)

As most Finance professionals say valuation is more like an Art rather than Science. There are various valuation methodologies that one could apply in order to determine the value of a company. The main methods are: Discounted Cash Flow (DCF), Comparable Multiples Method (CMM), Comparable Transactions (CT) and Real Options (less common). DCF incorporates the …